Damn that is a lot of houses for sale

[socalmoney]

Cool real estate site. http://www.redfin.com
This screen shot is of The Golden Triangle in Murrieta California.
http://www.***boat.com/forums/attachment.php?attachmentid=39571&stc=1&d=1190243707

[Jyruiz]

Buyers market.

[socalmofo]

And?

[socalmoney]

And?
And that is a lot of houses for sale!

[Big Inch]

And that is a lot of houses for sale!
Lol no kidding

[Bobbo541]

what is wrong with that area

[socalmoney]

what is wrong with that area
Not just this area, the who California Bubble. Riverside County saw tremendous growth the last 5 years. Lots of sub prime loans etc.

[socalmofo]

I just always get curious why the same people always post the foreclosure stats, subprime issues etc. What's the motive? Is it I told you so? Are you trying to buy something? What makes a person go out of their way to post this stuff? Just curious.

[Mandelon]

apparently it suffers from toohighpaymentitus.

[totenhosen]

I just always get curious why the same people always post the foreclosure stats, subprime issues etc. What's the motive? Is it I told you so? Are you trying to buy something? What makes a person go out of their way to post this stuff? Just curious.
Probably the same reason why people post comments in threads that they have no interest in other than to bash the original poster. If you don't like it don't click it or post a comment.

[socalmoney]

I just always get curious why the same people always post the foreclosure stats, subprime issues etc. What's the motive? Is it I told you so? Are you trying to buy something? What makes a person go out of their way to post this stuff? Just curious.
The current housing market is fascinating study of human behavior in the modern world. It is a huge anchor of our economy. It is also exciting for those who are prepared. It plays into so much, consumer goods, population growth, politics with the election coming up. Lots of emotions tied to it. People loosing their homes, people excited to get one because they have been so over priced. It effects the job market like crazy. How could you not find this interesting. I have never been a "I told you so" type of person so that is not my motivation. It is a huge turn of events from just a few years ago. Shit man, why do we talk about the weather or anything else in the Sandbar. It's all BS. Maybe your tired of seeing it because your just holding on. If that's the case, I wish you luck. If not, sit back and enjoy the show.
$

[Nord]

Buyers market.
Coming soon............

[LhcBrad]

Try doing a map like that in Havasu it looks kind of like that one.I saw one for sale for $134,000 im sure it was older but they are getting cheaper by the day

[CA Stu]

I just always get curious why the same people always post the foreclosure stats, subprime issues etc. What's the motive? Is it I told you so? Are you trying to buy something? What makes a person go out of their way to post this stuff? Just curious.
Ray Charles could have seen this coming.
Thanks
CA Stu
PS I think all those people in the green homes are victims.
PPS I wonder if any of them have a Rhino they want to sell? :idea:

[2Driver]

Zoom in, there is an H2 in every driveway. :D

[CA Stu]

Zoom in, there is an H2 in every driveway. :D
Victim vehicle, for sure.
Where's Jesse Jackson when you need him?
Thanks
CA Stu

[talkinghead]

Temecula and Murrieta have gotten hit hard with foreclosures, etc..

[THOR]

PS I think all those people in the green homes are victims.
Not possible. You cant be a victim if you are at fault. Just because you bought something you cant afford, it doesnt make it someone else's fault. No victims, just lack of restraint and brains.

[WYRD]

The current housing market is fascinating study of human behavior in the modern world. It is a huge anchor of our economy. It is also exciting for those who are prepared. It plays into so much, consumer goods, population growth, politics with the election coming up. Lots of emotions tied to it. People loosing their homes, people excited to get one because they have been so over priced. It effects the job market like crazy. How could you not find this interesting. I have never been a "I told you so" type of person so that is not my motivation. It is a huge turn of events from just a few years ago. Shit man, why do we talk about the weather or anything else in the Sandbar. It's all BS. Maybe your tired of seeing it because your just holding on. If that's the case, I wish you luck. If not, sit back and enjoy the show.
$
great post, many of us are seeing a realestate movement for the first time (I was too young to own a home in the 80's slide) so its very interesting to watch it unfold. I personally have learned alot by this slide and hope to see some good gains out of it. It is not an I told you so attitude because I truly feel for the people involved (both the buyers whom overstepped their limit and the people employed by the realestate sector in any manor) but rather a self proclaimed pat on the back for not falling victim to the economy.

[westair]

The current housing market is fascinating study of human behavior in the modern world. It is a huge anchor of our economy. It is also exciting for those who are prepared. It plays into so much, consumer goods, population growth, politics with the election coming up. Lots of emotions tied to it. People loosing their homes, people excited to get one because they have been so over priced. It effects the job market like crazy. How could you not find this interesting. I have never been a "I told you so" type of person so that is not my motivation. It is a huge turn of events from just a few years ago. Shit man, why do we talk about the weather or anything else in the Sandbar. It's all BS. Maybe your tired of seeing it because your just holding on. If that's the case, I wish you luck. If not, sit back and enjoy the show.
$
Good answer, except houses are never overpriced .... always at current market value.

[BadKachina]

Rhino they want to sell? :idea:
No shit, seems like people are selling Rhinos for more than they cost new.......:rolleyes:
When is the market going to tank on some of those?:idea:

[HM]

Not possible. You cant be a victim if you are at fault. Just because you bought something you cant afford, it doesnt make it someone else's fault. No victims, just lack of restraint and brains.
Thor....that is not true. There are lots of victims in this. I see lots of the Loan Officers here on ***boat making comments about people being stupid and they should have known what they got themselves into. Yet, the loan officers had no issue with making 3-4 points on these loans they couldn't afford and the real estate agents had no issues either with cashing their checks.
I started my own mortgage brokerage in 2004 because I hated mortgage people. Not all of them, just 99.99% of them. :D. Most of the people in the mortgage industry haven't got a financial clue, except that they make good money. I decided to go to some mortgage training events and conventions and I was blown away at what they teach mortgage people. They teach these people how to demonstrate that "now" is the best time to get a loan...no matter what is happening "now." They provide all sorts of very sophisticated looking charts that not only say rates will probably go down, but that all of this talk about a real estate bubble is just "haters" in the media looking to sell papers. And, the push to sell the option ARM/minimum payment loans was INTENSE. They taught loan officers to tell people that that loan is not for everyone, but it is for everyone that will "buy" it because it was very profitable. I have one CD with a "Mortgage Guru" who says, on the CD, that he professionally confuses his clients to the point of submission....so that they just do what ever he recommends. They teach loan officers how to convince 30 year fixed fully amortized loans are not good and that the minimum payment loans are for the "financially savvy" and know that everyone wants to think they are savvy. I have all the marketing paraphernalia from these "gurus" that they give you to put to work when you were done being trained. I swear I felt dirtier than SKOM/W67's ex-girlfriend!
I have a client letter that would be great to post, but I will just hit the high-lites for the sake of this post (and she is a lurker)....Her and her husband didn't think they could afford a home. She was already in the financing business (not residential) and she didn't think there was anyway they could afford a home. Her husband's boss had this "friend" that could get them into a home...NO PROBLEM..with 0 down. She didn't believe it, but, they wanted to own a home like anyone else...and if there was a chance, they wanted to know. Well, this loan officer comes back and says they are "pre-qualified" for a $650,000 home. She says "bullshit!" I don't qualify for a $100K car....how the hell do I qualify for a $650,000 home? Well, they keep getting urged that they are qualified and should buy. She decides that $650K is way too much, so she finds a home for $450,000. The loan officer keeps talking payments to her and keeps changing the subject about interest rate by saying....."Don't worry about it....we will just refi you in two years when rates are better and you have built up some equity." They trusted him because it was the husband's boss's good friend who was an expert. Well, of course, because it is a purchase, the loan officer hits them for another point on closing that wasn't disclosed to them until the final documents...the day before the home is supposed to close. By this time, they are in love with the house, the kids have picked out their rooms, and family is flying in from out of state to see their first home. She is pissed and signs anyway figuring she would just refi, but wouldn't use that same loan officer. Well...fast forward to today. Their loan adjusts this month and jumps about $1,500 up. And, their home is upside down by over $100K. They have great credit, but there is no possible way to refi without paying off the 2nd and even paying down the first...which they don't have the money to do that. This person does agree that she shoulder's some of the blame, but I know and all the loan officers out there know this is a COMMON story. She is working with her lender before they are in trouble, but they are taking a hard nose approach. She feels like walking because everyone made money of her while she is in a pickle and is looking at all the homes that are bigger for less money right now. Unfortunately, even with the mortgage industry imploding, many lenders are still trying to play hardball with borrowers. Just ask the Real Estate agents trying to do short sales.....they are doing their best not to give in - you don't blame the lenders for doing that. You would just expect them to be more reasonable since the foreclosure episode has only been a tease to this point in time.
I am personally tired of the blanket comments that people over extended themselves!! What did the industry expect when ALL the professionals were trained to SELL...not counsel their clients! I had picked up a couple real estate agents who wanted to use me as their broker because I was also a financial adviser and they thought that was a selling point to their potential clients....until I sat down with a couple of these potential customers and talked them out of the sale when it was obvious to me that they were way over their head. These real estate people got pissed off at me for killing their sale and told me that their clients are "adults" and should know what they are getting into (except they didn't like someone like me explaining EXACTLY what they were getting into.) There are lots of people who trusted the mortgage "professionals" (and I use that word lightly) to help them make the right decision...not just a yes decision. And how do the lenders get off the hook since they are the ones that approved these loans that people couldn't afford? How does Wall Street get off the hook for buying the mortgage backed securities of the loans that these people "couldn't afford"? It was like the entire industry was in complete denial doing their best imitation of Enron hoping everyone would just keep the faith and hold it together...even though it was a house of cards inside a runaway train.
Yes, there are lots of people who were very stupid on their own as well, but the first time buyers were easy victims for the mortgage industry. EVERYONE dreams of owning their own home. It is an easy sell because there is so much emotion tied in buying a home.
I personally like the "I told you so" threads going on because, as CA STu said....Ray Charles could have seen this coming, but there were people saying there will be NO BUBBLE burst. Well, you can't blame a lot of these "professionals" because they were being told this by their industry.
Real Estate is cyclical and it always goes up in the long run. I always tell my clients that are new to real estate that the name of the game is survival. If you can survive...you win. I always ran worst case numbers. If they were buying rental properties....did they REALLY have 6 months reserves? Could they handle the cash flow if rental rates dropped 20 or even 40%? Sure, I gave up some sales in the short term, but I got some really great clients! And for life.
Also, wait until you see how many loan officers start going to jail for stated income, stated assets, forged pay stubs, forged employment, and you name it over the next year or two. Many have already been nailed. There is still a lot of ugliness to come out, even if the Fed does a bail out....because the Feds don't want to have to bail out the industry again.
I have got so many stories about this industry in such a short time it is truly crazy. I tell people that the mortgage industry is the biggest collection of thieves and liars I have ever met. I am sure none of this applies to any of the loan officers on ***boat. :D And there are even a couple of you that I like.

[Fast Freddy]

Zoom in, there is an H2 in every driveway. :D
lmao

[Nord]

Thor....that is not true. There are lots of victims in this. I see lots of the Loan Officers here on ***boat making comments about people being stupid and they should have known what they got themselves into. Yet, the loan officers had no issue with making 3-4 points on these loans they couldn't afford and the real estate agents had no issues either with cashing their checks.
I started my own mortgage brokerage in 2004 because I hated mortgage people. Not all of them, just 99.99% of them. :D. Most of the people in the mortgage industry haven't got a financial clue, except that they make good money. I decided to go to some mortgage training events and conventions and I was blown away at what they teach mortgage people. They teach these people how to demonstrate that "now" is the best time to get a loan...no matter what is happening "now." They provide all sorts of very sophisticated looking charts that not only say rates will probably go down, but that all of this talk about a real estate bubble is just "haters" in the media looking to sell papers. And, the push to sell the option ARM/minimum payment loans was INTENSE. They taught loan officers to tell people that that loan is not for everyone, but it is for everyone that will "buy" it because it was very profitable. I have one CD with a "Mortgage Guru" who says, on the CD, that he professionally confuses his clients to the point of submission....so that they just do what ever he recommends. They teach loan officers how to convince 30 year fixed fully amortized loans are not good and that the minimum payment loans are for the "financially savvy" and know that everyone wants to think they are savvy. I have all the marketing paraphernalia from these "gurus" that they give you to put to work when you were done being trained. I swear I felt dirtier than SKOM/W67's ex-girlfriend!
I have a client letter that would be great to post, but I will just hit the high-lites for the sake of this post (and she is a lurker)....Her and her husband didn't think they could afford a home. She was already in the financing business (not residential) and she didn't think there was anyway they could afford a home. Her husband's boss had this "friend" that could get them into a home...NO PROBLEM..with 0 down. She didn't believe it, but, they wanted to own a home like anyone else...and if there was a chance, they wanted to know. Well, this loan officer comes back and says they are "pre-qualified" for a $650,000 home. She says "bullshit!" I don't qualify for a $100K car....how the hell do I qualify for a $650,000 home? Well, they keep getting urged that they are qualified and should buy. She decides that $650K is way too much, so she finds a home for $450,000. The loan officer keeps talking payments to her and keeps changing the subject about interest rate by saying....."Don't worry about it....we will just refi you in two years when rates are better and you have built up some equity." They trusted him because it was the husband's boss's good friend who was an expert. Well, of course, because it is a purchase, the loan officer hits them for another point on closing that wasn't disclosed to them until the final documents...the day before the home is supposed to close. By this time, they are in love with the house, the kids have picked out their rooms, and family is flying in from out of state to see their first home. She is pissed and signs anyway figuring she would just refi, but wouldn't use that same loan officer. Well...fast forward to today. Their loan adjusts this month and jumps about $1,500 up. And, their home is upside down by over $100K. They have great credit, but there is no possible way to refi without paying off the 2nd and even paying down the first...which they don't have the money to do that. This person does agree that she shoulder's some of the blame, but I know and all the loan officers out there know this is a COMMON story. She is working with her lender before they are in trouble, but they are taking a hard nose approach. She feels like walking because everyone made money of her while she is in a pickle and is looking at all the homes that are bigger for less money right now. Unfortunately, even with the mortgage industry imploding, many lenders are still trying to play hardball with borrowers. Just ask the Real Estate agents trying to do short sales.....they are doing their best not to give in - you don't blame the lenders for doing that. You would just expect them to be more reasonable since the foreclosure episode has only been a tease to this point in time.
I am personally tired of the blanket comments that people over extended themselves!! What did the industry expect when ALL the professionals were trained to SELL...not counsel their clients! I had picked up a couple real estate agents who wanted to use me as their broker because I was also a financial adviser and they thought that was a selling point to their potential clients....until I sat down with a couple of these potential customers and talked them out of the sale when it was obvious to me that they were way over their head. These real estate people got pissed off at me for killing their sale and told me that their clients are "adults" and should know what they are getting into (except they didn't like someone like me explaining EXACTLY what they were getting into.) There are lots of people who trusted the mortgage "professionals" (and I use that word lightly) to help them make the right decision...not just a yes decision. And how do the lenders get off the hook since they are the ones that approved these loans that people couldn't afford? How does Wall Street get off the hook for buying the mortgage backed securities of the loans that these people "couldn't afford"? It was like the entire industry was in complete denial doing their best imitation of Enron hoping everyone would just keep the faith and hold it together...even though it was a house of cards inside a runaway train.
Yes, there are lots of people who were very stupid on their own as well, but the first time buyers were easy victims for the mortgage industry. EVERYONE dreams of owning their own home. It is an easy sell because there is so much emotion tied in buying a home.
I personally like the "I told you so" threads going on because, as CA STu said....Ray Charles could have seen this coming, but there were people saying there will be NO BUBBLE burst. Well, you can't blame a lot of these "professionals" because they were being told this by their industry.
Real Estate is cyclical and it always goes up in the long run. I always tell my clients that are new to real estate that the name of the game is survival. If you can survive...you win. I always ran worst case numbers. If they were buying rental properties....did they REALLY have 6 months reserves? Could they handle the cash flow if rental rates dropped 20 or even 40%? Sure, I gave up some sales in the short term, but I got some really great clients! And for life.
Also, wait until you see how many loan officers start going to jail for stated income, stated assets, forged pay stubs, forged employment, and you name it over the next year or two. Many have already been nailed. There is still a lot of ugliness to come out, even if the Fed does a bail out....because the Feds don't want to have to bail out the industry again.
I have got so many stories about this industry in such a short time it is truly crazy. I tell people that the mortgage industry is the biggest collection of thieves and liars I have ever met. I am sure none of this applies to any of the loan officers on ***boat. :D And there are even a couple of you that I like.
Is there a "Readers Digest" version of this post..................Cliff notes anyone??:confused:

[HM]

Is there a "Readers Digest" version of this post..................Cliff notes anyone??:confused:
Sorry! :D Would you prefer to be rick rolled? :D

[Jyruiz]

Is there a "Readers Digest" version of this post..................Cliff notes anyone??:confused:
I read it, it was very interesting.

[bonesfab]

Very well said holymoly.........

[DILLIGAF]

I read it and agree with you. Long read but thanks for taking the time.

[socalmoney]

Good answer, except houses are never overpriced .... always at current market value.
Read Franks post about the lenders. They are the reason for the overpriced housing market. If they could not "create" buyers for homes that doubled in value in just 2-3 years, they would not have doubled. I do think that predatory lending caused a great portion of this mess. It will be very interesting to see how it is cleaned up.

[Nord]

HM, I finally read the whole post. I agree with the first part fully. However, the story of the girl you know that bought the 650K house..........the guy told her they should refi in 2 years when the rates go down.....That was a bad decision obviously. But, she knew she was getting into a risky deal. She said it herself "I can't even afford a 100K car". Its sad to see people "talked" into investments. Good or bad.
This mentality of blame the guy who talked her into it is half right don't take me wrong. But she is to blame as well. Sounds like she knew better. She took a risk and lost. I agree that the threads that "bash" these targets are cruel and I would never start one myself. But, these people did make wrong decisions.
I am very conservative. Almost too conservative. I have wanted to refi my house and buy another to rent out for quite sometime. I bought my house almost 7 years ago and have money to work with. Every agent tells me the same thing.......No problem, your way in the green, yada yada. But when I sit down and really crunch numbers, its a risk. My common sense tells me I can either take a risk with a chance of coming up, or standby. I choose not to take the risk. Maybe I won't be rich..........but I also won't be upside down either.
~NORD~

[Kilrtoy]

what is wrong with that area
They all just found out BOATFLOATING LIVES THERE.
kinda like the plague

[Hardly Satisfied]

Very well said holymoly.........
I 2nd that, thanks for sharing

[DCBDaytona]

Very well said holymoly.........
Agreed. I've always said LOs/RE Agents are one step above Car Salesman... (Not the HB ones;) )

[HM]

HM, I finally read the whole post. I agree with the first part fully. However, the story of the girl you know that bought the 650K house..........the guy told her they should refi in 2 years when the rates go down.....That was a bad decision obviously. But, she knew she was getting into a risky deal. She said it herself "I can't even afford a 100K car". Its sad to see people "talked" into investments. Good or bad.
This mentality of blame the guy who talked her into it is half right don't take me wrong. But she is to blame as well. Sounds like she knew better. She took a risk and lost. I agree that the threads that "bash" these targets are cruel and I would never start one myself. But, these people did make wrong decisions.
I am very conservative. Almost too conservative. I have wanted to refi my house and buy another to rent out for quite sometime. I bought my house almost 7 years ago and have money to work with. Every agent tells me the same thing.......No problem, your way in the green, yada yada. But when I sit down and really crunch numbers, its a risk. My common sense tells me I can either take a risk with a chance of coming up, or standby. I choose not to take the risk. Maybe I won't be rich..........but I also won't be upside down either.
~NORD~
Nord...I am glad you read it, but you didn't pay attention. :D
She did not buy a $650K home, they bought a $450K home trying to be more conservative. They are typical in that they did not really understand how it worked and no one explained the loan....only the payments and they depended on a "professional" to help them understand who obviously was only focused on closing the deal.
Nord, very few people know how to assess risk. Especially in an industry that actually depends on people being naive/ignorant and are trained to keep them naive/ignorant. You really have to see what they do and train on behind the scenes to fully appreciate it...and see the attitudes they have about people getting screwed by something they sold them by saying...."they are adults...they should know better." I have never said that about any of my clients.

[Sportin' Wood]

I agree HM, but lets not forget the armchair RE investors that everone turned into. We all know or heard of the people that had no business flipping houses giving it a shot. Hell they even have a house flipping show.
I can't tell you how many times I have been called an idiot for sitting on my equity. I'm pretty glad I have it right about now.
As far as "why do people post this kinda stuff?" The same reason people came on here talking about there 6 figure custom boats they were building with the equity from the house as a down payment.
I never understood why people with a single income working construction would buy the stay at home mom an H2.

[socalmoney]

Lets not forget about the Appraisers in all this.

[riverfun]

This is not me I swear, but my next door neighbor. Had a 30yr fixed at 5.75% and a home eq. line, wanted to just clean up his finances and simplify things ie. 1 payment etc. going through buying out his partner at his company and did not want to use up his cash to just pay off the HELOC. since his business will now be cash poor from the buy out. Found this mortgage broker that said he could get him re-fied with a smarter loan for the "savy" home owner. Yes I swear he did use that term. Well long story short my neighbor with the 780 fico, 120K yr. income and 100K locked up in CDs now has a 2 yr. ARM at 5% with a prepayment penalty and the loan can go NEG. AMORTIZATION depending on interest rates. And he paid 16K in "fees" he is now totally pissed at HIMSELF as he should be for not being more careful. Bad thing is he did not even know he got screwed until talking to me about the great 5% fixed rate loan he got and I said its impossible prove it to me so he showed me the papers. He thought the 16K was buying down the rate and that is was another 30 yr. fixed because he told the guy he wanted the same terms. He will not loose his home because payment is fine and he can afford even at the reset in 2 years, plus has over 250K equity still left. But DAMM I would not call this guy stupid in normal life but he got SHAFFTED by not knowing what he was doing, and being too preoccupied with other things in his life.

[HM]

I agree HM, but lets not forget the armchair RE investors that everone turned into. We all know or heard of the people that had no business flipping houses giving it a shot. Hell they even have a house flipping show.
I can't tell you how many times I have been called an idiot for sitting on my equity. I'm pretty glad I have it right about now.
As far as "why do people post this kinda stuff?" The same reason people came on here talking about there 6 figure custom boats they were building with the equity from the house as a down payment.
I never understood why people with a single income working construction would buy the stay at home mom an H2.
I remember talking to you about the "Guru" from RimCon trying hard ball you on some deal trying to make you feel stupid for your position.

[HM]

This is not me I swear, but my next door neighbor. Had a 30yr fixed at 5.75% and a home eq. line, wanted to just clean up his finances and simplify things ie. 1 payment etc. going through buying out his partner at his company and did not want to use up his cash to just pay off the HELOC. since his business will now be cash poor from the buy out. Found this mortgage broker that said he could get him re-fied with a smarter loan for the "savy" home owner. Yes I swear he did use that term. Well long story short my neighbor with the 780 fico, 120K yr. income and 100K locked up in CDs now has a 2 yr. ARM at 5% with a prepayment penalty and the loan can go NEG. AMORTIZATION depending on interest rates. And he paid 16K in "fees" he is now totally pissed at HIMSELF as he should be for not being more careful. Bad thing is he did not even know he got screwed until talking to me about the great 5% fixed rate loan he got and I said its impossible prove it to me so he showed me the papers. He thought the 16K was buying down the rate and that is was another 30 yr. fixed because he told the guy he wanted the same terms. He will not loose his home because payment is fine and he can afford even at the reset in 2 years, plus has over 250K equity still left. But DAMM I would not call this guy stupid in normal life but he got SHAFFTED by not knowing what he was doing, and being too preoccupied with other things in his life.
Yes...the mortgage people like to say things like "Fixed payment" and "30 year loan" to make people think they are getting a 30 year fixed loan. Most loans are 30 year loans. even the 40 and 50 year loans are actually 30 year loans....they just have a payment based on amortizing over 40 or 50 years with a balloon payment at the end of 30.
Your neighbor is a common story also. Too busy taking care of business, tells someone exactly what he wants and thinks that person will only bring him that, or explain that what he wanted wasn't available and that he has to choose from some other options to make it happen.
As hard as it is on everyone, this bust/implosion was and is still needed to help clean the industry up.

[talkinghead]

I'm sure books will be written about all of this (foreclosures, bad loans, etc..), and there is plenty of blame to go around. I always recall some general rules to follow when buying a home: Basically it should be no more than 3x ones salary. If you make 100k, buy a house around 300k using a 30 year fixed and you should be fine.
Now I know all kinds of excuses have been invented as to why the "old" rules don't work anymore - but mostly I think it's BS.
Not being self righteous, but I bought a house well within my means using a fixed rate 30 year loan from Wells Fargo - I am not behind on my payments, but ahead.
But so many people (especially in So. Cal.) IMO are extremely materialistic and are never satisfied to buy within their means.
BTW, except for the last few of years with the run up on prices, housing overall only returns about the inflation rate (source: Robert Shiller, Yale Economist). You can do that easily with TIPS bonds.

[talkinghead]

Most are scammers IMO and were most recently probably selling Amway, same goes for most RE agents.
I hope when this is all said and done we go back to the so-called "Dark Days of Lending".
In my estimation there should only be a few lenders in the US (not mortgage loan application processors making 300k a year):
BOFA
Wells Fargo
Countrywide (Reformed)
Wachovia
WAMU
Citibank
and a few other large true/actual lenders.
If you can't call BOFA (or similiar) and get a mortgage, you probably shouldn't be trying to get one at all. Wait until you get your finances in better order.

[socalmoney]

I always recall some general rules to follow when buying a home: Basically it should be no more than 3x ones salary. If you make 100k, buy a house around 300k using a 30 year fixed and you should be fine.
Find me a decent house in a decent neighborhood in Southern California for 300K. You obviously don't live here.

[talkinghead]

I do live in So. Cal. - and it can be done. On top of that, if lending becomes more conservative as it should, it will be done.

[CA Stu]

Is there a "Readers Digest" version of this post..................Cliff notes anyone??:confused:
"I told you so" :D
Thanks
CA Stu
PS There may not be nice homes for $300k many places in So Cal today, but wait another 6 months.

[riverfun]

It cannot be done at least not in LA or OC. Find me a house in a good neighborhood 3 bd 2 ba for 300K. You could 6 plus yrs. ago and probably will within 1-2 yrs. but you cant now. PS condos dont count! You cant even find a 2 bd. 1 ba. 900 sq. foot in my neighboorhood for under 450K. Also Im not a hater I bought my primary in 97 and my other 2 props. 4 yrs and 18 yrs ago. all on sub 6% fixed 30 yrs.

[HM]

The value of homes and the availability of money(aka rates) have an inverse relationship...so it is all relative. When money is short(rates high), home prices come down and vice versa. Talkinghead's rule of thumb is still somewhat relevant. Yes, in So. Cal...that is a hard rule to stick by if you are not willing to commute an hour plus to work for many people. But as he said, most won't have a choice since the lending restrictions are going back to old school.
Talkinghead....the basics of old school thinking will always be valid. The more things change, the more they stay the same.

[justfloatn]

I just always get curious why the same people always post the foreclosure stats, subprime issues etc. What's the motive? Is it I told you so? Are you trying to buy something? What makes a person go out of their way to post this stuff? Just curious.
I like to watch people fail:devil:
I never understood why people with a single income working construction would buy the stay at home mom an H2.
EGO! Emotion driven purchase.
Deep down we all want to appear successful (BALLER) and the lower the education (CONSTRUCTION) the more likely they are to give into their emotions and not rationalize their purchases.

[riverfun]

Ok just looked it up, in my neighborhood on realtor.com 2bd 1 ba 459K oh how about Compton 90222 cheapest 3 bd 1 ba 349K oh yea baby I want my kids to go to school there and my wife to walk the hood with all her homie peeps at night!

[HM]

Great point don't cha think?
I would also ask everyone do you not put your trust in your doctor, mechanic, accountant electrician,plumber etc......if we all new everything we would not need professionals. If I could fix my car, cure my illness, lay my own granite, finance my own loan, be my own attorney I surely would not pay a high premium for a professional to do it for me since I would surely do it wrong since I do not claim to be any of the above professionals I just mentioned. I can cut grass, so I no longer needed to pay someone.

[talkinghead]

Ok just looked it up, in my neighborhood on realtor.com 2bd 1 ba 459K oh how about Compton 90222 cheapest 3 bd 1 ba 349K oh yea baby I want my kids to go to school there and my wife to walk the hood with all her homie peeps at night!
That's due in large part to out of control lending among other things - that house in Compton for 349k will probably never sell at that price. BTW, are there any nice parts of Compton?
IMO, if you can't afford a house where you "need" but not "want" to live, then you rent until you can. Save up your money, cut back on your spending, etc...it will happen.

[Trailer Park Casanova]

We have some residential property in the Summerlin area of 'Vegas.
A search didn't bring up anything much on values.
Anyone know how 'Vegas is doing?
LV was is/was on the USA Today hit list to take the biggest fall in RE prices.
Any takes?

[talkinghead]

Point well taken, but there is a big difference between trusting your doctor and auto mechanic.
You can't really ask your doctor for the parts back...

[HM]

No daytonas is one of your clients?
nope.
Point well taken, but there is a big difference between trusting your doctor and auto mechanic.
You can't really ask your doctor for the parts back...
True. I trust my mechanic more than I trust my doctor. :D

[socalmoney]

Point well taken, but there is a big difference between trusting your doctor and auto mechanic.
You can't really ask your doctor for the parts back...
This is true, I asked for my appendix when they took it out, they said no.

[HM]

I don’t trust any of them either, but since I do not have the time to be a know it all I have to put faith in someone. I would say referrals is what everyone looks for when needing a professional, and in my real estate transaction, I wasn’t looking for a broker or agent, I was looking for a house to rent, when I was referred to one who when I expressed my doubts and concern over why I could not buy a house at this time, infact had a let me show you how answer for every concern I had, including giving me additional reasons as to why I should, like the tax write off benefit.
Frank I am sorry, but some of the comments give me the need to answer!!! I would join and answer myself but no one takes a newbie serious LOL unless I gave a picture of my boobs.
:D

[socalmoney]

I would join and answer myself but no one takes a newbie serious LOL unless I gave a picture of my boobs.
That is not much to ask for admission into this circus.

[hkunz]

I have to agree with HM on most of this. We have a mortgage company, and the lenders were pushing the Neg Ams, and before that the IOs. I didn't do those loans, and I know I lost clients because of it. I seemed to get the "I have a 13% note and no one will help me because my house is only worth $87,00" kind of clients. I didn't make much, but those clients are now repeat clients, and so are their family members. Meanwhile, others I know did the "unconventional loans" and the borrowers are very upset.
My answer when a client asked for a neg am or IO? "I'm sorry, but I like you, and I wouldn't do that to anyone I liked." It actually worked sometimes, and I got them into a loan they can live with, and I can sleep with. Some went elsewhere.
The question now for the RE professionals (in the true sense of the word) is how do we help the clients in this environment? I'm in this for the long term, as are those who can do something besides pick the low hanging fruit, but a new strategy is going to be needed.
They've been arresting agents of one of the most flamboyant real estate offices here in Bakersfield - FBI involvement, raids on homes and offices, not only of the agents and thier families, but also appraisers. I think it is only the beginning.

[DCBob]

Thanks, very insightful :)

[Sportin' Wood]

I would also ask everyone do you not put your trust in your doctor, mechanic, accountant electrician,plumber etc......if we all new everything we would not need professionals. If I could fix my car, cure my illness, lay my own granite, finance my own loan, be my own attorney I surely would not pay a high premium for a professional to do it for me since I would surely do it wrong since I do not claim to be any of the above professionals I just mentioned. I can cut grass, so I no longer needed to pay someone.
Hell thats what the internet is for. Just this morning I cured a cough, changed a wheel bearing, updated my bills in quick books, fixed a broken light switch, and free'd up a turd stuck in the shitter. On top of that I went head to head with the county on an Eminent Domain issue last year, took an RE class and applied for a lic with the state last week. I draw the line at Granite counter tops, that sh!t is heavy. C'mon guys whatta you do all day on the internet? Al Gore did not invent this thing so you could sit on Bulliten boards all day. Learn how to cure cancer for christ sake. You can be Ordained and take a class on enviromental science at UC Berkeley all in the same day.... C'mon!:D

[OutCole'd]

We have some residential property in the Summerlin area of 'Vegas.
A search didn't bring up anything much on values.
Anyone know how 'Vegas is doing?
LV was is/was on the USA Today hit list to take the biggest fall in RE prices.
Any takes?
TPC, Vegas is WEAK!! Not much going on here at all. Seems as though the only thing that may sell is the lower priced 200-350k properties.
I'm in Summerlin also and homes seem to sit on the market for 6-8 months before there selling.

[LOWRIVER2]

I'm sorry, common sense should not be lost when understanding the "old school" idea of a 30 year fixed loan and exactly what that means.
Simple rule: real estate in Ca. will forever (minus major disaster), be cyclical. Does'nt take a genius to figure it out. Those down in Temecula/Canyon Lake/Murrieta that are suffering the most are the ones that got greedy and bought a second house on a risky loan , trying to have a rental property when, in fact, they were'nt ready financially to pull the trigger. Does'nt mean that area is "bad", just happened to be where the housing growth was the largest when the cycle went bad.
I have two friends down there in this spot, one just foreclosed on both (Murrieta/Can. Lake) and the other is close to losing both as well. They both knew the risk whether they admit it or not. Numbers don't lie.
While I agree there are shady characters in every profession, I disagree that a buyer with half a brain would not seek advice from at least three, hell five different agents on an investment that, if done wrong, could screw up their chance of future home ownership for a decade. Guess there's a lot more rose colored optimists ready to be hypnotized by snake oil salesmen than I thought.
Understand what you earn, recognize risk, and ACKNOWLEDGE what level of RISK you are willing to take on ANYTHING. If you can't do that with yourself, you have'nt the right to cry "poor me" when whatever decision you make goes bad.
That said, I hate to see people lose there homes regardless, but put blame where it lies, with the buyer. No one had a gun to my head to sign the dotted line on my properties. I wonder why?.....LOL

[Jyruiz]

TPC, Vegas is WEAK!! Not much going on here at all. Seems as though the only thing that may sell is the lower priced 200-350k properties.
I'm in Summerlin also and homes seem to sit on the market for 6-8 months before there selling.
Not that I want people to loose there homes, but I am hoping it doesn't turn around in the next 2 to 3 years, contemplating a move to Henderson when my wife is done with her Masters program.

[Forkin' Crazy]

Victim vehicle, for sure.
Where's Jesse Jackson when you need him?
Thanks
CA Stu
In Jena, LA :rolleyes:

[2Driver]

Unfortunately a lot of people decided to take Personal Finance 101 from a salesman selling mortgages instead of getting it from their parents, a reference book or college.
This very basic stuff should be part of high school curriculums. Of all the crap they stuff in your head in school that you will never use, they bypass how to balance a check book and manage personal money. :rolleyes:

[uLtRADeNniS]

Not possible. You cant be a victim if you are at fault. Just because you bought something you cant afford, it doesnt make it someone else's fault. No victims, just lack of restraint and brains.
Agreed!. People loose their homes because they don't make payments...Not because of the type of loan they got. The type of loan they got was their fault, not their lenders.
Think about it...
Bad scores, no reserves, no assets, low income....and people knew their own situations and still bought a home.

[Sportin' Wood]

Unfortunately a lot of people decided to take Personal Finance 101 from a salesman selling mortgages instead of getting it from their parents, a reference book or college.
This very basic stuff should be part of high school curriculums. Of all the crap they stuff in your head in school that you will never use, they bypass how to balance a check book and manage personal money. :rolleyes:
I could not agree more. Angie and I have a freind (since Highschool days) that teaches at the local high school. two years ago we had a discussion about this very item. He took it upon himself with some of what we talked about to write a curriculum and put together a lesson plan on how to manage money in the real world. He spent all last year trying to get it approved. Still no luck getting the district to allow him to teach it, so he just gives the short version as a subliminal message.

[2Driver]

I could not agree more. Angie and I have a freind (since Highschool days) that teaches at the local high school. two years ago we had a discussion about this very item. He took it upon himself with some of what we talked about to write a curriculum and put together a lesson plan on how to manage money in the real world. He spent all last year trying to get it approved. Still no luck getting the district to allow him to teach it, so he just gives the short version as a subliminal message.
That is unreal and depressing at the same time.
Since I retired early I thought about doing that very thing but feared the 10 year battle of red tape to get it in. I was lucky, I grew up with a Dad that was President and Chairman of the Board of a successful bank, otherwise I wouldn't have gotten it anywhere.

[77charger]

glad we bought our house in fullerton 7.5 years ago when we could barely qualify for the loan and not do multiple refis to buy brand new high priced toys.
but in last years market we could have qualified for 3-4 times as much:) even though i know we would not be able to afford it.
this is just the start of things going south as far as forclosures go!I work in construction and have seen things getting slow for the last year.people are spending way less went from complete remodels to just fixing what is broken so to say

[westair]

Read Franks post about the lenders. They are the reason for the overpriced housing market. If they could not "create" buyers for homes that doubled in value in just 2-3 years, they would not have doubled. I do think that predatory lending caused a great portion of this mess. It will be very interesting to see how it is cleaned up.
How do you know when the price is where it should be? If the housing prices are back up to where they were in 2 to 3 years will they be considered "overpriced"
Nobody knows exactly when the right time to buy is, if you can hold on to it long enough there is no bad time.
I agree, it is very interesting how this housing market works.

[sdpm]

I have worked a few boat shows in my time. What always killed me was someone looking at buying a boat but had nothing to tow it with or even a place to park it when they got it home. I would listen to salesmen tell the customer that his Chevy S-10 would pull the 26' boat with no problem! Yet the salesman never stopped pushing for that sale. The wife would stand there and try and talk to the husband about these things and all he could think about was how fun it was goin to be and how he was going to look in that bad a$s boat.
I see no difference from a boat salesman to a loan company. It's all about nailing the deal!!

[sdpm]

If someone walked into Eliminator and ordered a 30' cat with twin 2000hp engines with #6 drives and was filthy rich and wanted to pay up front but had never owned a boat before, do you think they would they not sell to him?

[shueman]

If someone walked into Eliminator and ordered a 30' cat with twin 2000hp engines with #6 drives and was filthy rich and wanted to pay up front but had never owned a boat before, do you think they would they not sell to him?
I doubt it...prolly talk him down to a more manageable model based on his/her expertise...:idea:

[THOR]

Agreed!. People loose their homes because they don't make payments...Not because of the type of loan they got. The type of loan they got was their fault, not their lenders.
Think about it...
Bad scores, no reserves, no assets, low income....and people knew their own situations and still bought a home.
Can I get an Amen.

[talkinghead]

Ultimately, it is the consumers fault. On the other hand, it's about like offering a crackhead crack, and then when they take it state it's all their responsibility. Ofcourse it is, but they are addicts - when you offered the crack you knew they would take it.
But since were on the subject of responsibility - let's make everyone involved responsible. Do not bail out any consumers or corporations because hey, it's their own fault. I'm all for that, let's just make sure it's even accross the board.
But I know it won't be.

[HM]

Some of you are comparing apples to oranges. There are a LOT of laws around lending and disclosure. The insurance/finance world has already gone thru some painful changes. They no-longer get sued over "mis-representation"....they get sued over "suitability"...which means the "professional" can be sued for selling a product or service that is not suitable for the client....even when the client is "Fully" educated on what they are buying. These people have a fiduciary responsibility to do what is right for the client and the professional is liable if they fail in their fiduciary responsibility.
Right now, the worlds largest insurance company (Allianz) has the largest class action law suit against them in the history of insurance companies. They have sold an annuity product that is very tempting to people because it gives them a 10% bonus on their money from day one....outperforms ALL mutual funds and does it with 0 risk of losing. Here is the downside....you never get your money back. The liquidity of your money is basically eliminated. If you ever decide to "cash-out" your annuity they will only give you 87% of your original deposit(s) even if you have waited until it matures. If you annuitize out of your annuity, they move it into a fixed account at 1-2% and annuitize it over 10 years and the end result ends up being similar to if you kept your money in a CD at 4-6% over the same period. It is actually a great product for just a few people as there is another way to draw income and continue the performance, but this annuity was sold to people it was not "Suitable" for as this product also paid the highest commission of any annuity so it was "pushed" heavily on people that should never have bought it.
So, this "suitability" is coming to the mortgage and even the real estate industries. The "professionals" are supposed to be more than just sales people in large financial transactions with consumers. They have regulated the shiat out of the industry and the abuses continue. So they will give more latitude to sue the companies that profit at the demise of the client, no matter how educated the clients are on what they are buying. Suitability has a LOT of gray area for lawyers to work with.

[cdog]

Some of you are comparing apples to oranges. There are a LOT of laws around lending and disclosure. The insurance/finance world has already gone thru some painful changes. They no-longer get sued over "mis-representation"....they get sued over "suitability"...which means the "professional" can be sued for selling a product or service that is not suitable for the client....even when the client is "Fully" educated on what they are buying. These people have a fiduciary responsibility to do what is right for the client and the professional is liable if they fail in their fiduciary responsibility.
Right now, the worlds largest insurance company (Allianz) has the largest class action law suit against them in the history of insurance companies. They have sold an annuity product that is very tempting to people because it gives them a 10% bonus on their money from day one....outperforms ALL mutual funds and does it with 0 risk of losing. Here is the downside....you never get your money back. The liquidity of your money is basically eliminated. If you ever decide to "cash-out" your annuity they will only give you 87% of your original deposit(s) even if you have waited until it matures. If you annuitize out of your annuity, they move it into a fixed account at 1-2% and annuitize it over 10 years and the end result ends up being similar to if you kept your money in a CD at 4-6% over the same period. It is actually a great product for just a few people as there is another way to draw income and continue the performance, but this annuity was sold to people it was not "Suitable" for as this product also paid the highest commission of any annuity so it was "pushed" heavily on people that should never have bought it.
So, this "suitability" is coming to the mortgage and even the real estate industries. The "professionals" are supposed to be more than just sales people in large financial transactions with consumers. They have regulated the shiat out of the industry and the abuses continue. So they will give more latitude to sue the companies that profit at the demise of the client, no matter how educated the clients are on what they are buying. Suitability has a LOT of gray area for lawyers to work with.
So true. On one hand I hear and read that Brokers and agents are scum A- holes but on the other hand all this up roar will make the process more complicated and require more money and more expensive transactions. The phrase "slippery slope" comes to mind. It all boils down to loose underwriting.

[HM]

So true. On one hand I hear and read that Brokers and agents are scum A- holes but on the other hand all this up roar will make the process more complicated and require more money and more expensive transactions. The phrase "slippery slope" comes to mind. It all boils down to loose underwriting.
You and I both know that both the mortgage and real estate industries are dominated by scum a-holes...much more than "just a few bad apples." But, they are dealing with the largest financial item in most people's lives and there needs to be responsibility put on the "professional" making a profit on that transaction. It seems like an obvious thing that people should just do....but a majority don't. Yes....loose underwriting is also a major culprit and is why I said the lenders themselves also hold responsibility as they approved all of these loans that people couldn't afford...or won't be able to afford when the rate adjusts or the loan re-casts. Are lenders victims of stupid borrowers? I think they knew exactly what they were doing except they were in denial that the market and industry would implode.
I have talked at a couple of CAMB meetings about suitability. There were a few financial/insurance guys in the group that all they did was nod in agreement with me while I got blank stares by the majority of the mortgage people who's biggest concern was what kind of rebate does suitability have. <---J/K'ing. :D But not really. :D

[cdog]

You and I both know that both the mortgage and real estate industries are dominated by scum a-holes...much more than "just a few bad apples." But, they are dealing with the largest financial item in most people's lives and there needs to be responsibility put on the "professional" making a profit on that transaction. It seems like an obvious thing that people should just do....but a majority don't. Yes....loose underwriting is also a major culprit and is why I said the lenders themselves also hold responsibility as they approved all of these loans that people couldn't afford...or won't be able to afford when the rate adjusts or the loan re-casts. Are lenders victims of stupid borrowers? I think they knew exactly what they were doing except they were in denial that the market and industry would implode.
I have talked at a couple of CAMB meetings about suitability. There were a few financial/insurance guys in the group that all they did was nod in agreement with me while I got blank stares by the majority of the mortgage people who's biggest concern was what kind of rebate does suitability have. <---J/K'ing. :D But not really. :D
When my 19 year old sisters ex boyfriend called me one day and asked if I could send him some mortgage biz I knew we'd be in for some deep shit someday. I used to know a wealthy couple who are mortgage brokers. Both of them told me they make more money on subprime loans than conventional. They preferred to do subprime. Here you had both unqualified and qualified people who found the weak spot in the system and capitalized on it. Some call that taking advantage. Others call that capitalism.
As with any project, job or career, the lowest bidder is not always the smartest choice. I don’t work for 1%. But I don’t fuk people over either. If you choose Help U Smell, I’ll do it for free . com u get what you pay for.

[HM]

.... Others call that capitalism.
Along with capitalism comes the responsibility of the person making profits. Many countries scoff at the U.S. with all the law suits, but then those countries have so many restrictions on business that make it much tougher companies before they even make a profit. The seminar crowd people like Mark Victor Hanson and Robert Kyosaki have bee kicked out of Australia, New Zealand, and even Canada when authorities question them on what makes them "experts" when they have no licensing nor any degrees in what they do. I have an Aussie friend that is hilarious to hear how the Aussies treat the people doing "wealth seminars" and the Aussies basically tell them to get the fock out of their country. But...these countries have far less opportunity than America - or at least did at one time. America is slowly getting the worst of both worlds....heavy regulation with unlimited liability mostly due to the inability for businesses to self regulate.
If people are getting focked while you are making a profit, you can bet the farm that shit will hit the fan....especially if you get in line and ask for a bail-out.

[cdog]

Along with capitalism comes the responsibility of the person making profits. Many countries scoff at the U.S. with all the law suits, but then those countries have so many restrictions on business that make it much tougher companies before they even make a profit. The seminar crowd people like Mark Victor Hanson and Robert Kyosaki have bee kicked out of Australia, New Zealand, and even Canada when authorities question them on what makes them "experts" when they have no licensing nor any degrees in what they do. I have an Aussie friend that is hilarious to hear how the Aussies treat the people doing "wealth seminars" and the Aussies basically tell them to get the fock out of their country. But...these countries have far less opportunity than America - or at least did at one time. America is slowly getting the worst of both worlds....heavy regulation with unlimited liability mostly due to the inability for businesses to self regulate.
If people are getting focked while you are making a profit, you can bet the farm that shit will hit the fan....especially if you get in line and ask for a bail-out.
I agree with you. This whole mess has shown us how behind the bell curve our system is. Right hand has no idea what the left is doing. The knee jerk reaction will be to over regulate.

[HM]

I agree with you. This whole mess has shown us how behind the bell curve our system is. Right hand has no idea what the left is doing. The knee jerk reaction will be to over regulate.
I want to add that it is not just that businesses can't self regulate...that is way over simplifying the issue and very one sided. we definitely have a society of victims. It has to be someone's fault. Add to that businesses not properly self regulating when profiting from the detriment of consumers and you can definitely expect major knee jerk reaction regulation. I happen to like the "suitability" angle that regulators take. I function very well in that kind of environment because I am more driven by purpose than by profit...and my P & L statements prove it. :D But, I believe that I will be very profitable in the long run.
I have even created my own software for calculating/measuring suitability when I am putting financial plans together. It is not something I show my clients. It helps keep me in check with what I recommend and also is a CYA as I do get held to suitability on the financial services side of my business. We have suitability forms we have to fill out, but I also do a print out from the software. And it is more than just debt ratios and so forth. But, it only evaluates individual products as being suitable and not over all plans. But, I can run it on each product if I am recommending multiple products and get a bigger picture suitability picture as well. It is tough in an industry when you have regulators who think agents who sell annuities to anyone older than 65 should be arrested. :idea:

[talkinghead]

Yesterday I wanted to confirm my earlier suggestion that houses are still selling. I went around in Temecula looking at new houses - in almost every neighborhood new inventory was either sold-out or just one or two houses left.
Also, most of the resale houses I was looking at are sold as well.
The frenzy continues...
Based on my experience I'm not sure what I am hearing in the media is true, and it may have been manufactured by NAR to get people buying (creating the illusion that it's a buyers market).

[cdog]

Based on my experience I'm not sure what I am hearing in the media is true, and it may have been manufactured by NAR to get people buying (creating the illusion that it's a buyers market).
HA! Manufactured by NAR! New builders set the price on supply and demand. They can reduce to make 10% profit or raise 30% to sell where the market is willing to buy. They are in the biz to build homes not to sell them.
Sellers on the other hand are in a dream world of keeping up with the Jones’s thinking their equity is an extension of their checking account. We're about half way thru this downturn if the economy holds up.
Go look at a Non Conforming loan with 20% down. At 7% + it’s a joke with today’s prices. The last time we had 7% I was new in the business in 1999 and 4 bed homes in Anaheim Hills were in the mid to high 3’s. Now they’re in the mid to high 7’s. Something has to adjust and it’s prices. Econ 101. Supply & Demand.

[cyclone]

Here's something to think about: would the agent still be a shark and is the loan still a "bad loan" if the market didn't turn south?
I know a lot of people that bought houses 4 years ago with loans they didn't exactly understand and they are happier than crap because they were able to refi before the market turned. They let their agent/broker do the thinking for them and it worked in their favor.
I know another group of friends that bought in the last two years and they are completely screwed and cannot get refi'd becuase their homes now appraise for less than they owe. They also let their agent/broker do the thinking for them and are now paying the price.
Can any agent or broker really know exactly when the market will turn and when to stop selling "bad loans"?
I wimped out on buying a year ago and i'm glad i didn't listen to my agent and her broker who told me things like "you need to get in the market now." and buy a house i knew i couldn't afford later on.
at the end of the day you've got to make the decision whether or not its safe to cross the street or whether taking out a loan on a 500K house when you work at McDonalds is a good or bad decision.

[socalmoney]

How do you know when the price is where it should be? If the housing prices are back up to where they were in 2 to 3 years will they be considered "overpriced"
Nobody knows exactly when the right time to buy is, if you can hold on to it long enough there is no bad time.
I agree, it is very interesting how this housing market works.
I really don't think we will see 2004/2005 median home prices in 2-3 years. The income just won't support it. Look at this chart. It is crazy how big the bubble got. 70% of our GDP is consumer spending. When times get tough, people stop spending money on crap they don't need. When that 70% goes down, people will start loosing work. We are the largest consumers in the world. When we stop buying stuff, the whole world will feel it.
http://piggington.com/images/primer/sdprices_incomes.gif

[socalmoney]

I see no difference from a boat salesman to a loan company. It's all about nailing the deal!!
http://www.youtube.com/watch?v=y-AXTx4PcKI
http://www.youtube.com/watch?v=8V0d4fSbFOo

[HM]

Here's something to think about: would the agent still be a shark and is the loan still a "bad loan" if the market didn't turn south?
Absolutely.
But....the loans are not "bad" loans. They are good loans used by the wrong people for the wrong purpose. These "bad" loans didn't just show up in the last few years....they have been around for 25+ years....but were used mostly by people who knew what they were doing. Because our society is a "monthly payment" society, these loans were just an easy sale.

[HM]

http://www.youtube.com/watch?v=y-AXTx4PcKI
http://www.youtube.com/watch?v=8V0d4fSbFOo
http://video.google.com/videoplay?docid=-3534760319051287914&q=boiler+room&total=797&start=0&num=10&so=0&type=search&plindex=0

[mbrown2]

Absolutely.
But....the loans are not "bad" loans. They are good loans used by the wrong people for the wrong purpose. These "bad" loans didn't just show up in the last few years....they have been around for 25+ years....but were used mostly by people who knew what they were doing. Because our society is a "monthly payment" society, these loans were just an easy sale.
I don't buy it....If the "Professionals" were doing something illegal, forging docs, loading appraisals, kick backs, quesitonable underwriting, etc...they were doing something illegal and should be hung..
But don't preach the victim mentality because some "professional" got his training from a used car sales man turned Real Estate professional and now bamboozles his clients into the most self-profitable venture.....They are lemmings and people are not in business to fix lemmings, they are in business to make a profit....I am sure people had more then a clue about the risk they got into....
If you are talked into something that is legal, and you don't know what you are doing and all the documents have the correct figures on them...then jokes on you. You cannot down play the fact you have to sign those docs and understand the loan and how it is either fixed or adjustable...
Loan docs are pretty clear....particularly when it comes to adjustable loans and when they have pre-pays..
Are you saying they did not read them? If not, their fault...
Are you saying they did not understand them but signed them anyway? If not their fault...
Alot of foreclosures are for non-owner occupied...ie: investors and flippers...are they also victims here? I say no...they were probably very clear on what they were signing up for...
I agree certain loans are for people who are smarter then others....but underwriting guidelines don't say don't give a loan to a dumb person or that would be discriminatory lending practices........they are just as free to get that loan as the smart person..
Just because there are predatory sales tactics in every field does not mean all companies should be in the business of fixing stupid people, that was their parents job....you sound like you help dumb people...that's very noble, but not necessarily the primary goal in sales.

[WaterJunky]

I am sorry but as I have said before in other posts, It's all about personal responsibility. Know what you are getting into, educate your self.
Life is tough, the world is going to be your best friend one day and screw you the next. That is just how life works. People need to take resposibility for their actions. Just because the commercal on TV said its great, does that mean it is? Why would a loan officer ( I realize that not all are like this) who is making more money by selling you more tell you something other than "Max it out, buy all that you can"?
People need to do the hardest work possible, think for themselves.
Just my $0.07 on it.

[CA Stu]

Something has to adjust and it’s prices. Econ 101. Supply & Demand.
I used the exact same "Economics 101" line today talking with a friend at work. :D Spooky.
Anyway, Alan Greenspan may have a bit better handle on the reality of the housing market than the average "Real Estate Professional" (who was likely working at McDonalds two years ago).
House prices to drop much lower: Greenspan (http://news.yahoo.com/s/nm/20070921/bs_nm/greenspan_bubble_dc_1)
The culpability falls to the purchaser if and only if the seller / loan officer disclosed all the terms and conditions honestly and up front.
If there were falsified, inflated estimates, and fraudulent loan documents knowingly created and used, then the seller / loan officer / mortgage company is absolutely liable (in my opinion) and should be prosecuted to the fullest extent of the law, and stripped of any ill gotten gains.
I'm sure glad I didn't spend my (fantasy smokle and mirrors) equity!
Thanks
CA Stu
PS It is un-freeking-believable that someone has their (talking)head so far in the sand they are still preaching the Gospel of "It's the best time to buy!!!"
GMAFB!
PPS I told you so!

[socalmoney]

And?
And has none of this been at all interesting to you. If not I want to know why not?

[talkinghead]

I am sorry but as I have said before in other posts, It's all about personal responsibility. Know what you are getting into, educate your self.
It's also about corporate responsibility - if companies take risks and get burnt, let them burn too...

[talkinghead]

PS It is un-freeking-believable that someone has their (talking)head so far in the sand they are still preaching the Gospel of "It's the best time to buy!!!"
GMAFB!
PPS I told you so!
I NEVER said it was a good or best time to buy, on the contrary in fact.
On the other hand I have been recently looking at two new communities in Temecula - they are both either completely sold out or nearly sold out. And that occurred in a fairly short period of time - but to watch the news one might think practically nothing is selling.
Also, houses in the Bay area are still going for 500+/sq. ft.

[socalmoney]

Damn, 50% off Miami Condos. Watch this news clip.
http://www.youtube.com/watch?v=tkuW8bCjC6c

[CBadDad]

What ever happened to buyer beware?

[socalmofo]

And has none of this been at all interesting to you. If not I want to know why not?
Very interesting. Funny actually.

[Deano]

I NEVER said it was a good or best time to buy, on the contrary in fact.
On the other hand I have been recently looking at two new communities in Temecula - they are both either completely sold out or nearly sold out. And that occurred in a fairly short period of time - but to watch the news one might think practically nothing is selling.
Also, houses in the Bay area are still going for 500+/sq. ft.
Do you think that maybe the houses are not actually sold? That the builder is using the whole "we only have one left" as a sales tactic to get you to buy? When in reality they have several available. I don’t know either way, but I looked at some Toll Brother houses last week in Corona and they tried it.
I don't have much to say about the brokers. Buyer beware is right. Kinda sucks to be in escrow, five days before closing and all of a sudden your loan needs to change. Fukin crooks.

[talkinghead]

Do you think that maybe the houses are not actually sold? That the builder is using the whole "we only have one left" as a sales tactic to get you to buy? When in reality they have several available. I don’t know either way, but I looked at some Toll Brother houses last week in Corona and they tried it.
That is a distinct possibility...also "sold" and "closed" are two different things...

[talkinghead]

There were rumors flying around that Standard Pacific may be the next victim in all of this - they may not survive.

[CA Stu]

No offense, man, but it's hard to take a post seriously with no capitalization and so many grammatical, spelling, and punctuation errors.
For the life of me, that post looks like it was written by a 10 year old. Not a bright one, either.
What kind of formal education do you posess that makes you qualified to even be in the real estate business?
Seems like every unemployable illiterate in California decided to get into the "real estate buissness" over the past 5 years. And suddenly it's a mess? What a coincidence! :rolleyes:
I personally would not even entertain letting someone advise me on a transaction of any consequence unless they could at least communicate on an adult level.
What sucks about the whole "relief" effort is that people that have been fiscally responsible and lived within their means are now being expected to bail out their neighbors who have lived high on the hog based on a scam.
I'm not entirely comfortable with that.
Thanks
CA Stu

[totenhosen]

No offense, man, but it's hard to take a post seriously with no capitalization and so many grammatical, spelling, and punctuation errors.
For the life of me, that post looks like it was written by a 10 year old. Not a bright one, either.
What kind of formal education do you posess that makes you qualified to even be in the real estate business?
Seems like every unemployable illiterate in California decided to get into the "real estate buissness" over the past 5 years. And suddenly it's a mess? What a coincidence! :rolleyes:
I personally would not even entertain letting someone advise me on a transaction of any consequence unless they could at least communicate on an adult level.
What sucks about the whole "relief" effort is that people that have been fiscally responsible and lived within their means are now being expected to bail out their neighbors who have lived high on the hog based on a scam.
I'm not entirely comfortable with that.
Thanks
CA Stu
That about sums up what I was thinking as I was reading it. Personally I liked the words themselfs and lieing

[mbrown2]

I know it seems like we get only bad news these days and like the share the lukewarm news when it comes across......found this one interesting this morning...
AN INSIDER'S VIEW FROM THE CAPITAL MARKETS COOPERATIVE TRADING DESK:
“Jumbo loan prices – of both the adjustable- and fixed-rate varieties – had a banner week. Spreads, while not back to pre-collapse levels, are trading at levels that might even be called respectable. Our sources tell us that while lower credit tranches are not yet trading well, the AAA pieces are as well-received as they have been in months. Rate sheets came back in stair steps, with Wells posting strong fixed-rate bids early in the week, and CitiMortgage and Chase posting very strong ARM levels late in the week and today. While spread markets are still volatile, we are getting more optimistic by the day. Corporate bonds, junk bonds, and LIBOR swap spreads are all moving tighter because liquidity has returned to the financial markets. Banks are lending, the commercial paper market has stopped its collapse, and LIBOR has returned to approximately 0.50% over Treasuries.” (CMC traders price, hedge, and sell $billions of mortgages for their clients, and offer a front-line perspective on the markets.)
Even the employment markets seem to be recovering. “Was it all a dream?” asks Barron’s in reference to August’s terrible jobs report. September’s report was right on the money (+110,000 jobs) and was full of upwards revisions that made the August report a whole lot better (+89,000 jobs instead of a loss of 4,000). Friday’s report made trading interesting – the ten-year Treasury fell 100bps and has returned to where it was prior to the Fed rate cut.
The odds for another rate cut on Halloween dropped to about 50/50, and plunged for any cuts beyond that. The last three times the Fed initiated a new easing cycle, ten year bond yields dropped 20 basis points or more in the next five days. This time they rose by 20 basis points, which didn’t help mortgage rates a bit.
Are our dreams of lower rates turning in to nightmares? Bill Gross and John Mauldin don’t think so. They are both predicting that the Fed will cut rates to 3.75% before the housing mess is done. At the moment, however, the bond market is clearly worried about inflation. “The market should start worrying about something else,” said John Mauldin. “Inflation is not a problem in a recession, and certainly not in one caused by the bursting of the largest housing bubble in US history. Be definition, those are deflationary events. If we have a simple slowdown I think rates drop to 4% or less. If we see a recession, short term rates will drop below 3%.”
Here's good news: George W. Bush says that he is committed to fighting global warming. Yeah, well, he nipped that in the bud, didn't he? – (David Letterman)
Thanks for your business and have a good week. -- Tom Millon
Capital Markets Cooperative (CMC)
Market Close Wk Chg
30-Yr Mortgage 6.43% +0.06%
10-Yr Treasury 4.64% +0.05%
2-Yr Treasury 4.11% +0.12%
Fed Funds 4.75% -0.50%
Fed (Dec ’07) 4.52% +0.10%
Fed (May ’08) 4.32% +0.15%
Dow Industrials 14,066 +170
Indicator Due Consensus Previous
Producer Price Index Fri +0.4% -1.4%
Retail Sales Fri +0.3% +0.3%

[cdog]

Rumor is the conforming loan limits will be raised soon. And California will have a permanent increase like Hawaii and Alaska. The worst may be over in areas that have lowered their prices by 10-20% already. Maybe 5-10% left in the reset. It really has more to do with location location location than anything else. Newer tract home type areas will show the most weakness due to competition with the builders. We'll see.

[Havasu1986]

Seen a sold sign on a house on the next street over. It was listed for 920K. Its been on the market for only a couple months. Not sure what he got though.

[mbrown2]

Seen a sold sign on a house on the next street over. It was listed for 920K. Its been on the market for only a couple months. Not sure what he got though.
Friends of ours just bought in Yorba Linda for probably right around that price...but they moved in probably two months ago.

[talkinghead]

I feel I have to say this again: Houses seem to be selling like crazy in Temecula.